Prominent Sri Lankan banks were trading at values significantly lower than their fundamental book value last week (30), presenting a buying opportunity for investors, Ambeon Securities' Weekly Stock Scan noted.

The data showed that non-voting shares of Hatton National Bank PLC (HNB.X) were priced at Rs. 372, a fraction of the Net Asset Value Per Share (NAVPS) of Rs. 508.51. This reflects a Price to Book (P/B) ratio of 0.73. Further, Seylan Bank PLC (SEYB.X) traded at a P/B of 0.61. DFCC Bank PLC (P/B: 0.66) and National Development Bank (P/B: 0.70) also showed similar disparities, indicating a market-wide de-rating of the banking sector’s worth.

Exhibiting further pessimism, shares of HNB.X and SEYB.X traded at historically low price-to-earnings ratios, with HNB.X at a P/E of 3.94 and SEYB.X at 4.11. AMW Capital Leasing and Finance PLC also showed a significant valuation gap, with its share price at Rs. 22.40 and a P/B of 0.12. Conversely, Inusureme Insurance Brokers Limited PLC commanded a P/B of 24.82 and a P/E of 293.87, indicating high growth expectations. 

Softlogic Life Insurance PLC emerged with leading gains of up to 15.27%, reaching Rs. 86.80, with Merchant Bank of Sri Lanka and Finance PLC following closely with a 14.29% increase. On the losing end, SMB Finance PLC's non-voting share fell by 25.00%.

Among outliers in the insurance sector, Amana Takaful Life PLC (ATLL.N) showed a P/E of 10,671.98, while Inusureme Insurance Brokers Limited PLC (INME.N) traded at Rs. 1,730.25 with a P/E of 293.87 and a P/B of 24.82.